To Nokia’s credit, it used to be the №1 mobile brand. Even a great innovator, who led the feature phone revolution & changed the way of our life forever. Still remember my workdays in the 90s, I spent a lot of time on the road to visit customers around Taiwan. On the road, I could get many things done via phone calls, thanks to 2G service & feature phones. A funny thing was whenever foreign visitors traveling with me, they always joked about how much I like to talk to my phone instead of them. In my defense, it’s just daily routines for most Taiwanese workers on the road. Or, maybe wherever 2G service is affordable.
Having that said, Nokia has not played a similar role in the smartphone revolution. Today, let’s extrapolate what lessons learned from 3 traps: success, nostalgia & commodity. Maybe they can shed some light on the ongoing Smarter Car revolution.
The Success Trap
…I believe in the power of wandering. All of my best decisions in business & in life have been made with heart, intuition, guts. You know, not an analysis. If you can make a decision with analysis, you should do so. But…
— Jeff Bezos At The Economic Club Of Washington, 2018
You’ll have a tough time winning a brand new game by following the old rules. While Nokia, the old king of feature phones focused on the back mirror seeing all glory yesterday, the world keeps moving ahead with or without the old king. For example, even far before iPhone & Android, BlackBerry had been eating Nokia’s lunch by providing end-to-end mobile text message/e-mail services for professional users based on the 2G SMS network service. Sometimes, it’s not all about the tech, but also what pain points you really solve.
Arguably, it’s not entirely Nokia’s false on misjudging. Rather it’s the common success trap we all subject to. Only, the bigger & more successful one is, the more easy & severe one victim may be. Just check the numbers, 3 years after iPhone first launched, there was still at least one Nokia in every 3 new phones in 2010, still holding the №1 title. Whenever a new game is becoming the thing, it’s just difficult if not impossible for a top player to reckon “it’s me, not the market” 💔.
In 2009, I joined countless Motorola reorg & town hall meetings, most executives kept talking about the past glory & similar comeback plans. While I appreciated the efforts to motivate, I also relativized it’s the time to move on from the same old tunes. Finally, at the end of 2009, the new CEO stopped all in-house feature phone development, which cut me loose. Thanks, Moto for a fun ride & excused me from further roller coasters early.
Don’t get me wrong, a successful comeback maneuver is indeed externe difficult. And, it’s more an art than a science. But dear car makers, there is still time for you: “don’t do Nokia” this round. My 2 cents for those who dare to be different:
- At a phase change like this, few sustaining solutions won’t cut it. Please take The Innovator’s Dilemma seriously.
- Back mirror focusing & analysis paralysis may do more harm than good for such joinery ahead. Jeff’s 3 tips can be useful: move faster on two-way-doors decisions, make them as early as possible e.g. around 70% of the in you wish you had & do course correcting as you go, even more insights in Amazon’s 2016 Letter to Shareholders.
The Nostalgia Trap
Nostalgia can be a powerful product strategy but applying it with care. As they say: it works 50% of the time. The problem is nobody knows which 50% will work 🔮. In tech., I’m pretty sure the chance is much less than 50% because the industry respects innovation a bit more than traditions as MS CEO, Nadella wrote to MS employees in 2014.
For example in 2017, HMD & TCL both betted on nostalgia to revive Nokia & BlackBerry brands. Nokia 3310 is still a good phone for specific users, and BlackBerry KeyOne was almost a nice try of mission impossible. While wishing both get whatever they wish for or learn some things, both brands did not get back to their old glories by playing the nostalgia card. As the real beauty is never skin deep, nostalgia may only work for those properly build-in deeply.
The Commodity Trap
Hardware churns every 18 months. It’s pretty impossible to get a sustainable competitive advantage from hardware. If you’re lucky, you can make something a half or 2 times as good as your competitor. Which probably isn’t enough to be quite a competitive advantage. And it only lasts for 6 months. But software seems to take a lot longer for people to catch up with.
— Steve Jobs at MIT Sloan School of Management 1992.
All things commoditize sooner or later. As the Kano model suggests: once delightful innovation will become another basic need over time in a competitive market. So deal with it 😉.
Arguably mobile was more “fun” before iPhone. At last, they used to come with all sorts of shapes, colors & shells. In 2004, Moto Razr rocked the world with a razor-thin & good-looking clamshell phone. It was a simpler world, where the color Pink could be a thing. And Nokia had its fair share of leading hardware innovation for that decade too.
But, against many early doubts in iPhone in 2007, smartphones become popular expensive rectangle boxes. Not because of its shape, but how they power so many software & service innovations we enjoy today. As a BBC News article put it: “but what Apple saw was that all you needed was a rectangle with a screen, and the rest was all about the software.” Nokia was too complacent to sustaining innovation, it used to.
So What, Cars Will Be Different
Indeed, cars will be very different because it’s still very much an expensive hardware product. I do love BMW’s big curved display & Ford’s new spin of all-electric F-150 Lighting. BTW, kudos Ford for getting 45K reservations in 48 hrs. I just want to urge everyone to explore 3 important hypotheses early rather than later.
- Other new players have no obligation to respect the tradition over innovation. Some innovators are breaking the old rules & established boundaries. And, the market is rewarding those pioneers handsomely.
- IVI & self-driving systems are still information systems. Users mostly likely expected them to progress on par with another tech. Otherwise, they will just find a better substitute, e.g. smartphones.
- As 5G ramping up & no going back from the new normal, it’s a great time to redefine mobility. As much as I love to get one Knight Industries Two Thousand for real, I also dream of my own Mobile Command Center to work from anywhere.
Full Disclosure
The opinions stated here are my own, not those of my company. They are mostly extrapolations from public information. I don’t have insider knowledge of those companies, nor a whatever expert.
